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THE MCLAUGHLIN GROUP

HOST: JOHN MCLAUGHLIN

JOINED BY: PATRICK BUCHANAN, ELEANOR CLIFT,
CLARENCE PAGE AND MORTIMER ZUCKERMAN

TAPED: FRIDAY, JANUARY 10, 2003
BROADCAST: WEEKEND OF JANUARY 10-12, 2003



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THIS IS A RUSH TRANSCRIPT.
-------------------------

MR. MCLAUGHLIN: Issue one: Roll up the tripwire.

PRESIDENT HARRY TRUMAN: (From videotape.) I believe that we
must try to limit the war to Korea, for these vital reasons: to make
sure that the precious lives of our fighting men are not wasted, to
see that the security of our country and the free world is not
needlessly jeopardized.

MR. MCLAUGHLIN: Fifty years ago the Korean War ended in a
stalemate, with a Korea divided, split in two.

Since then, the United States' strategy for preventing aggression
against South Korea by North Korea has been the U.S. Army tripwire
force. Along the Demilitarized Zone south of the 38th Parallel, the
U.S. keeps 37,000 troops. Opposing them: 1 million North Korean
troops.

The deterrent value of the token U.S. troop presence stems from
North Korea's realization that an attack on South Korea means engaging
U.S. troops, the tripwire, thus triggering a massive U.S. response.
That's the theory.

It has been thought that the tripwire is key to the stability of
the Korean peninsula and thereby Asia. Question: Is it, or do our
37,000 U.S. troops work less to Seoul's advantage and more to
Pyongyang's advantage? Is it not true that precisely because American
troops are on the line, the North Korean bluster works? Washington
sends food, Washington sends fuel, and Washington gives international
stature by negotiation with North Korea.

The U.S. troops are, in a word, hostages to North Korea, leverage
for Kim Jong Il to use to engage the Bush regime to nuclear blackmail.

Also, the U.S. military presence does little or nothing to ensure
U.S. solidarity with South Korea. Gallup says that a majority, 53
percent, of South Koreans dislike the U.S., up from 15 percent eight
years ago. Fifty-one percent want U.S. troops gone.

And get this:

The newly elected South Korean president, Roh Moo Hyun, rejects
Bush's naming of North Korea as a member of the world's "axis of
evil," and Roh Moo Hyun vows to continue his predecessor's sunshine
policy, reconciliation with the North, and Roh Moo Hyun declared
during his presidential campaign that South Korea should not
automatically back the U.S. in a war with North Korea, all of which
may add up to bringing our U.S. troops home and letting those with
most at stake, South Korea, China, Japan, Russia -- North Korea's
neighbors, that is -- be the ones to keep Pyongyang in line.

Question: Is it time to reel in the tripwire? Is it time to
withdraw our troops from the Korean peninsula, Pat Buchanan?

MR. BUCHANAN: John, we are never again going to send 300,000 or
500,000 young Americans to go fight a war on the Asian mainland. For
that reason, we ought to pull this tripwire of 37,000 troops out of
Korea, rely on air and naval power. And if North Korea continues to
build toward a nuclear weapon, we ought to tell the North Koreans and
the Chinese that we will remove all restraints we have on the
democracies of South Korea and Japan building their own nuclear
deterrence.

MR. MCLAUGHLIN: Do you agree with the unassailable logic of the
set-up?

MR. BUCHANAN: I think your logic, I think the piece was
outstanding, it was right on the mark, and it's a view I've held since
1989, John. We've got to start looking out for our own national
interests here, as the South Koreans are and the Japanese are and the
Chinese are, who are giving us no help whatsoever in the Bush policy
or the policy he wants basically of tough containment and stifling the
North Korean regimes.

MR. MCLAUGHLIN: What do you think, Eleanor? Do we put the
burden of containing Kim Jong Il on China if we pull our troops out?

MS. CLIFT: With all due respect, there is nobody seriously
proposing that we pull out those troops. Those troops are there
because it is one of the two most unstable borders in the world, the
other one being India-Pakistan. And if we could put 37,000 troops
there, we would too.

MR. BUCHANAN: That would be insane.

MS. CLIFT: And if the United States, in a fit of pique because
there are some anti-American demonstrations, pulls those troops out,
what you would have is a whole region doubting the U.S. word, because
our commitment is that we will leave those troops there as long as
South Korea wants them as part of the armistice. There was never a
peace agreement. And what would happen is, you would have a nuclear
South Korea, a nuclear Taiwan and a nuclear Japan in a heartbeat. Is
that what you want?

MR. BUCHANAN: You want me to answer that question? That's the
future, friends.

MS. CLIFT: No, it's not -- (cross-talk and laughter) -- not if
we remain engaged. Not if we remain engaged.

MR. MCLAUGHLIN: Clarence, welcome.

MR. PAGE: Thank you, John.

MR. MCLAUGHLIN: It's a pleasure to have you sitting in that
chair. I thank you and the chair thanks you.

MR. PAGE: (Laughs.) Well, we do miss Tony, though. I told Pat
he's got to hold down the whole right wing for this show. But you
know, I actually find myself in some agreement with Pat, as well as
Eleanor. I'm right between them, which is a position I'm comfortable
with.

But no, I think that we're not going to pull out of South Korea
this weekend, but it is time for us to think seriously about changing
the whole relationship --

MR. MCLAUGHLIN: Not now.

MR. PAGE: -- reexamining it.

MR. MCLAUGHLIN: Not now.

MR. PAGE: Not now, of course.

MR. MCLAUGHLIN: It would be a sign of -- we'd see it as a sign
of weakness.

MR. PAGE: Absolutely. You know, I think this is a very delicate
time of negotiating with the North. However, this is not our fathers'
or grandfathers' Korea; this is a whole new generation in South Korea.
Operation Friendship, which you referred to there -- or, excuse me,
Sunshine, the new reconciliation spirit is very strong in South Korea.
I mean, we're in a weird situation right now, where there's massive
demonstrations in South Korea against us because our policy is just
not fully realistic right now. So I think we're in the process. It's
just not going to happen right now.

MR. MCLAUGHLIN: Mort, welcome to you, too. Do you see a lot of
daylight showing in our relationship with South Korea, just as there's
a lot of daylight showing in our relationship with Germany? Is this
poor stagecraft or -- statecraft or diplomacy on Bush's part, do you
think, that these splits are occurring?

MR. ZUCKERMAN: No, I don't think it's a function of Bush's
statecraft. I mean, this is something that's been brewing for a
while. It's caused, in part, by an incident involving the death of
two young Korean girls who were killed by an American military
vehicle. And these soldiers were tried and they were found innocent
by an American military tribunal, not by a South Korean. It's caused
a huge amount of reaction within that country.

But let me just say there's another rationale for keeping our
troops there, because I happen to disagree with that approach of
removing them or thinking of removing them. And that is, they were
put there really as a tripwire to prevent a conventional attack from
North Korea on -- I mean, Seoul, Korea, is within artillery range of
North Korea.

The one thing you don't want to have is to have them in a position to
shell South Korea and really create havoc there, and then have to
figure out what you do. You're not going to attack them, and you
can't, frankly, defeat that kind of a country -- North Korea -- with
air power.

So I think that what has changed is that they've now developed
nuclear weapons and the capacity to deliver them. That's a whole
other threat. But in the meantime, the tripwire, in my judgment,
protects us from the conventional threat. We've got to figure out --
and we haven't yet -- how to deal with that nuclear threat coming from
North Korea.

MR. MCLAUGHLIN: You know --

MR. BUCHANAN: (Inaudible) -- roll over them in an -- I mean,
there are 37,000 guys up against a million people. You cannot stop
that artillery there. Get our troops out of the way with it. You
respond with air power and we can beat them.

MR. MCLAUGHLIN: I want to go back to the anti-Americanism in
South Korea.

MR. ZUCKERMAN: Yes.

MR. MCLAUGHLIN: Are you claiming that Roh Moo Hyun during his
campaign was aggressive, similar to the way Chancellor --

MR. ZUCKERMAN: Schroeder.

MR. MCLAUGHLIN: -- Schroeder did in Germany?

MR. ZUCKERMAN: Right.

MR. MCLAUGHLIN: He won his election because he was -- to a great
part, because he was antagonistic to this president.

MR. ZUCKERMAN: Right. Right.

MR. MCLAUGHLIN: Are you claiming that that's owing to the death
of two young women?

MR. ZUCKERMAN: No, no, that's not the only reason. The fact is,
America, as the sort of hyperpower in the world, is the country that
is going to inspire resentment all over the world.

MS. CLIFT: Well, there was a huge --

MR. ZUCKERMAN: And that --

(Cross talk.)

MR. MCLAUGHLIN: Ah! You know, that is so overly facile.

MR. ZUCKERMAN: It may be facile. It's a basic fact of life.
It's true in Europe.

MS. CLIFT: There was a huge --

(Cross talk.)

MR. ZUCKERMAN: Look, Germany is a country which we have stood
for and protected for 50 years, and they resent us. Please. And by
the way, it was East Germany, not West Germany, that opposed the
United States.

MS. CLIFT: There was a huge outpouring of goodwill towards this
country after 9/11, and President Bush has squandered most of it in
his bullying language and his talking big and being overly aggressive.

Four elections -- South Korea, Germany, Pakistan and Turkey --
have all elected governments that basically rose there because of
anti-Americanism. And that's something the administration should not
ignore.

MR. MCLAUGHLIN: All right. Did you take note that Tony Blair is
backing away from his commitment to war? He has said, "We must let
the inspectors take their time and do their work properly."

MR. ZUCKERMAN: (Inaudible.)

MR. MCLAUGHLIN: Is this a --

MR. BUCHANAN: This is Iraq.

MR. ZUCKERMAN: Iraq.

MR. MCLAUGHLIN: Is this a structural defect in the load-bearing
wall that Bush is trying to build?

MR. ZUCKERMAN: No, I don't think so.

MR. BUCHANAN: Oh, it is.

MS. CLIFT: The president is now plugged into the U.N. operation,
and Jack Straw, the foreign minister of England, has said that the
burden of going to war has now shifted from 60-40 yes to 60-40 no.

MR. BUCHANAN: John, it's off.

MS. CLIFT: And the fact that they have not come up with any kind
of smoking gun delays the onset of possible war by at least several
weeks and perhaps longer.

MR. BUCHANAN: The war is off, John.

MR. MCLAUGHLIN: What war is off?

MR. BUCHANAN: The war -- you just shifted to the war in Iraq.
The war is off. One reason is the Brits are getting cold feet. The
Turks are holding us up for billions and billions of dollars --

MR. MCLAUGHLIN: Why not? Why not? Look what Desert Storm cost
us!

MR. BUCHANAN: Because they're not afraid of Iraq, and they say,
"Look at the" -- they say the Israelis are holding us up and the Turks
are holding us up and the Brits don't want to go. And the troops
aren't there right now. We can't do it on the ground right now. We
can do it in the air, maybe. We don't have the forces in place to do
it on the ground.

MR. MCLAUGHLIN: Okay. In war, no new fronts. On Monday I
returned from Saudi Arabia and the region. In Riyadh, the Saudi
foreign minister, Prince Saud al-Faisal, granted me a ranging two-hour
interview on a vast array of issues. I'll be drawing on that
interview in upcoming weeks.

Here's one brief segment, where I asked the foreign minister
about the U.S. problems in North Korea, Iraq and the al Qaeda war, all
contemporaneous. Here's Saud's answer.

"One thing that we have always been concerned with is that the
fight against terrorism is a consuming fight. It is a dangerous
fight. It requires persistence and continuity. It is not a one clear
swoop of the sword and you destroy all the evildoers. It is a war in
all meanings of the word 'war.'

No war was ever won by opening other fronts. This is why we are
urging consideration of a political solution for Iraq. This is why we
are urging that the Israeli-Palestinian peace process commence quickly
and the results quickly, because peace is there for the taking."

Question: The foreign minister's caution is, don't open new
fronts when you're already waging a major war. Is that good advice in
this instance, would you say? I ask you, Clarence.

MR. PAGE: Yes, it is, because while our Pentagon says we're
ready to fight a multi-front war or two different wars at once, we're
really not. And right now we need our allies. And we're sending
mixed messages around the world by such a joint statement as "axis of
evil" but three entirely different policies toward these three
different countries, as we should have. And also, the mention there
of the Arab-Israeli conflict, that is the biggest thorn in the side of
our ability to make progress in the Middle East, other than oil
itself, which has been holding back progress for too many of the
countries there.

MR. MCLAUGHLIN: Mort, some people think that progress is being
made in the Middle East because of what's going to happen two weeks
from this coming Tuesday, which is an election. And the Likud party,
thanks to Mr. Sharon, who is being charged with having bought votes,
has slipped from a position of -- correct me if I'm wrong, because I
know that your knowledge in this area is inexhaustible, as well as in
other theaters of human activity -- (laughs) --

MR. ZUCKERMAN: Don't let me interrupt you. Go ahead.
(Laughter.)

MR. MCLAUGHLIN: -- 41 to 27 seats on the basis of the current
polls. Correct?

MR. ZUCKERMAN: That's right. That's correct.

MR. MCLAUGHLIN: So is it possible that Amram Mitzna, who is the
head of the Labor party, might have a chance of winning this election?

MR. ZUCKERMAN: No. The votes that were a part of the Likud
party, 41 seats, have shifted to other center-right parties. The same
70 votes are still all focused on the three center-right parties, and
that's where the government will be formed. It will be a weaker
government, in the sense that the Likud party, if this is the way it
comes out, will not be as dominant in that coalition as it would have
been, but the same coalition will be formed. It's a center-right
coalition. Mitzna has not caught on as a politician. The Labor party
has not gone up very much, maybe one or two seats. So the center of
the country is essentially in and around the same constituency with
Likud at a much lower level because of exactly what you said. It
wasn't that Sharon was involved; it's that the Likud central committee
was involved, or some of them were, in terms of buying votes.

MR. MCLAUGHLIN: You see Sharon as secure?

MR. ZUCKERMAN: Not -- well, as I say, secure in the sense that
he's going to to be the next prime minister, but not secure in the
sense that he will have the mandate that he hoped to come out of this
election.

MR. MCLAUGHLIN: Well, can we draw any comfort, Pat, that it will
not be Netanyahu?

MR. BUCHANAN: Well, no. Netanyahu got clobbered by Sharon, but
I think Sharon's in more trouble than Mort thinks.

MR. MCLAUGHLIN: Why do you say that?

MR. BUCHANAN: Well, I think he's disintegrating on this. Look.
He's in real trouble. I mean, this is illegal activity that he's
being charged with, John. You and I went through Watergate, as you
recall, you know.

MR. MCLAUGHLIN: Now, wait a minute, Pat. (Laughter.)

MR. BUCHANAN: Look.

MR. MCLAUGHLIN: I happened to be --

MR. BUCHANAN: Well, let me get to the --

MR. MCLAUGHLIN: I was a speechwriter. (Laughter.) Never called
before the Ervin committee. Were you?

MR. BUCHANAN: I spent six hours before the committee, John.
(Laughter.)

MR. MCLAUGHLIN: (Laughs.)

MR. BUCHANAN: Look, let me get to the second front. Normandy was a second front. A second front -- the Confederacy was --

MR. MCLAUGHLIN: Now, wait a minute.

MR. BUCHANAN: -- the Confederacy was beaten by a second front.
It can be the right thing to do. What I disagree with is North Korea
does not threaten the United States of America, in my judgment. North
Korea does not -- I mean, Iraq does not threaten the United States of
America. Al Qaeda threatens us. We ought to stay focused on our
enemies and let other folks deal with their enemies.

MR. MCLAUGHLIN: Why was Normandy a second front?

MR. BUCHANAN: Well, because Stalin was holding up the Eastern
Front -- the Soviet Union!

MR. MCLAUGHLIN: I'm talking about our forces --

MR. BUCHANAN: He called for a second --

MR. MCLAUGHLIN: -- our forces --

(Cross talk.)

MR. BUCHANAN: He was an ally in World War II! (Laughter.)

MR. ZUCKERMAN: John --

MS. CLIFT: Let's not refight World War II!

MR. ZUCKERMAN: We had a second front. It was called the
Pacific!

(Cross talk.)

MR. MCLAUGHLIN: Exit question: On a doomsday scale of zero to
10, zero meaning zero danger of doomsday, 10 meaning metaphysical
doomsday, apocalypse now, annihilation of the world, what's the danger
of an eminent war on the Korean peninsula? Scale of one to 10 -- zero
to 10.

MR. BUCHANAN: Zero doomsday but one or two of a serious regional
war.

MR. MCLAUGHLIN: Really?

MR. BUCHANAN: Mm-hmm.

MR. MCLAUGHLIN: Eleanor?

MS. CLIFT: I'll put it at 1.5. The U.S. doesn't want it. I
think the North Koreans are just applying pressure here to get some
more emoluments from the administration; to get a sweeter deal out of
this administration than they did from Clinton, and they'll get it.

MR. MCLAUGHLIN: Yeah, well, I'm not sure I draw any comfort out
of either one of yours low evaluation.

MR. PAGE: Well, also, they've been getting a much worse deal out
of the Bush administration. The Bush administration is moving closer
to the Clinton position.

MR. MCLAUGHLIN: What's the danger of apocalypse?

MR. PAGE: It looks like a six by the headlines, however, in
reality, it is more like Eleanor and Pat are saying.

MR. MCLAUGHLIN: Is it a crisis?

MR. PAGE: It's more like a one or a two.

MR. MCLAUGHLIN: Is it a crisis?

MR. PAGE: It's not a crisis right now. It looks like one in
public, but there's a lot of back-channel negotiations going on, John
--

MR. MCLAUGHLIN: It's not a crisis.

MR. PAGE: -- and there is progress being made --

MR. ZUCKERMAN: In New Mexico.

MR. PAGE: -- made in New Mexico, for example.

MR. MCLAUGHLIN: Do you think it's a crisis?

MR. ZUCKERMAN: I -- let me just give you my odds on the thing;
it's .01347, actually, to give you the exact count. No, I don't think
we are going to go to war, but I do think it is a pending crisis.
There is no way of dealing with that North Korean regime that fits in
within the context of the way we deal with them.

MR. MCLAUGHLIN: Oh, there is a way of dealing with it. The way
to deal with it is the way Clinton dealt with it and Albright dealt
with it.

MS. CLIFT: Right.

MR. MCLAUGHLIN: That's the way to do it.

MR. ZUCKERMAN: Bribe them. Bribe them. And so you now put
yourself five --

MR. MCLAUGHLIN: What's wrong with that? What's wrong with that?

MR. ZUCKERMAN: -- five years later -- because what's wrong --

MR. MCLAUGHLIN: What's wrong with bribing Israel? What's wrong
with bribing Palestine?

MR. ZUCKERMAN: What's wrong -- what's wrong with -- what's wrong
is that we are now in a situation where the danger of war and the
nature of that danger is much worse than it was if we had faced up to
it in 1994.

MR. MCLAUGHLIN: You are so anti-diluvian, really! This is --
(laughter) --

MS. CLIFT: John -- John's right on this one!

MR. MCLAUGHLIN: -- and the --

MR. ZUCKERMAN: John, I have always aspired to be called anti-
diluvian by you, an unlikely standard to which I have aspired.
(Laughter.)

MS. CLIFT: Well --

MR. MCLAUGHLIN: That's nice. We've got to get diplomacy going
again.

MR. ZUCKERMAN: No doubt. I don't disagree with that.

(Cross talk.)

I didn't say that.

MR. MCLAUGHLIN: I mean, we were sending mixed signals! But we
were very slow in fulfilling the what? The agreed -- the agreed
agreement --

MR. ZUCKERMAN: I would remind you --

MR. BUCHANAN: We have no interest whatsoever in going to war
with North Korea, you are right. We ought to talk, and frankly, we
are going to wind up with a deal pretty close to what Eleanor said.

MS. CLIFT: Exactly. Right.

MR. MCLAUGHLIN: When we come back, can the White House sell the
Bush economic plan to the Democrats, or will the Democrats see that as
selling out their own political base?

(Announcements.)

MR. MCLAUGHLIN: Issue two: Bold or reckless? And I'm talking
here about the president's finance or economic plan.

What do you think, Pat?

MR. BUCHANAN: I think it is bold; I think it's dramatic; I think
he included all elements; it's philosophically sound; it's in-your-
face to the Democratic Party; I think it is leadership on Bush's part.
I really commend him.

MR. MCLAUGHLIN: What about the reaction of Democrats and their
caterwauling on this?

MS. CLIFT: Well, this is classic Karl Rove. You stun your
opponents by this bold, audacious plan, and then you make deals and
claim victory with whatever you get. They're not going to get this
non-taxable dividend income. And this is a plan heavily skewed to the
rich that does nothing to stimulate the economy in the immediate short
term. It's a big bribery of the right wing, basically. (Laughter.)

MR. MCLAUGHLIN: I want to talk --

MR. : (Inaudible.)

(Laughter.)

MR. MCLAUGHLIN: I want to talk about the base of the Democrats.
Sixty-two percent of Republicans, according to a Wall Street Journal
poll, have at least $5,000 invested in stocks and mutual funds. A
plurality of Democrats -- 49 percent -- say they don't. Majorities of
African-Americans, liberals and union members don't. For core
Democratic constituencies, cutting dividend taxes does not work.
Therefore, how is he going to get this through?

MR. ZUCKERMAN: Well, I think what's going to happen here --

MR. MCLAUGHLIN: Because the Democrats won't support it.

MR. ZUCKERMAN: Of course they're not going to support it, for
political reasons as well as for economic reasons. The economic
reason is they don't feel that it's front-loaded enough to stimulate
the economy, and they want to get credit for whatever they're going to
try and do that is going to put a lot more money into the economy in
2003 and the first part of 2004 and try and claim credit for it.

MR. BUCHANAN: Democrats have pensions funds, John, and they are
gigantic, and if that market goes up -- and it's gone up about 500
points -- they will benefit.

MR. PAGE: But pension funds are already tax-exempt. They're not
going to benefit from this plan. In fact, Bush should have -- if he
really wanted to jump-start things -- given a break to corporations
that are -- (word inaudible) -- their dividends.

MS. CLIFT: This is class warfare against millions of Americans
who will not get the benefit, and on young people who will have to pay
off that tab this president is running up. The deficits are totally
irresponsible.

MR. ZUCKERMAN: And those people who have retirement funds, those
dividends were exempt anyhow. They're not taxable.

MR. BUCHANAN: Their value's gone up.

MR. MCLAUGHLIN: What about the effect on the market if dividend
taxes are cut?

MR. BUCHANAN: It's up.

MR. ZUCKERMAN: The market -- most people believe the market will
go up between 7 and 10 percent. But let me just tell you, 90 percent
of the stocks are owned by the top 10 percent of the income spectrum.
So it's not going to be seen as benefiting the other 90 percent to the
degree that --

MR. BUCHANAN: It's gone up 7 percent this year almost.

MR. ZUCKERMAN: Great. Great.

MS. CLIFT: And the states really get zilch.

MR. MCLAUGHLIN: Yeah.

MR. ZUCKERMAN: That's off of a very low base, after having been
off almost 40 percent. This is not exactly what I call progress.

MR. BUCHANAN: The market is saying yes to Bush's tax plan. Why
are you saying no?

(Cross talk.)

MR. ZUCKERMAN: I didn't say no! (Laughs.)

MR. MCLAUGHLIN: Which plan has more appeal, the Bush plan or the
Democratic -- any one of or all of the Democratic eight alternatives?

(Cross talk.)

MR. MCLAUGHLIN: I want to listen to Eleanor.

MS. CLIFT: The Democratic plans are classic textbook stimulus.
They're temporary, they take effect immediately, and they don't cost a
lot of money.

MR. MCLAUGHLIN: They want $300 per person tax reductions.

MS. CLIFT: That worked the last time to offset the recession.

MR. BUCHANAN: Oh, for heaven's sakes!

MS. CLIFT: It's not a bad idea.

MR. PAGE: The basic question of politics is, "Where's mine?"
And if people don't feel like they're getting a personal benefit out
of it, I mean, the average person is going to get enough money out of
this to buy one or two new VCRs maybe, but it's not going to really
help the economy at all.

MR. BUCHANAN: The Democratic plan is classic Keynesian, and
quite frankly, it is timid, and it's not going to go anywhere. Part
of it's revenue sharing for governors so they can pay off their
deficits.

MR. MCLAUGHLIN: Is it also distribution of wealth?

MR. BUCHANAN: Sure it is. Three hundred bucks for everybody? I
mean, what are we talking about?

MS. CLIFT: Well, so is the Republican plan redistribution of
wealth, to the top! (Laughs.)

MR. BUCHANAN: Letting people keep their own money that they
earn.

MS. CLIFT: Pat -- (chuckles) --

MR. ZUCKERMAN: Yes, no doubt about it. But the people who earn
that money do not exactly represent a majority of the American public
--

MS. CLIFT: No.

MR. ZUCKERMAN: -- and that's the problem that the Democrats are
going to have when they face up to it. They have their constituency.
The Republicans have their constituency. I know you're surprised.
Your benefits will be hurt.

MR. MCLAUGHLIN: There was one Republican who spoke up in --
opposed to the president's plan.

MS. CLIFT: Lincoln Chafee.

MR. BUCHANAN: Mm-hmm.

MR. MCLAUGHLIN: His name is --

MR. BUCHANAN: John McCain

MR. BUCHANAN: -- John McCain.

MR. ZUCKERMAN: Right.

MR. MCLAUGHLIN: And as soon as Shelley (sp) is ready, we'll
listen to what John McCain has to say.

SEN. JOHN MCCAIN (R-AZ): (From videotape.) You will find that
the bulk of it, again, goes to the wealthiest Americans. I would like
to see some of that redistributed more heavily to middle-income and
low-income Americans.

MR. MCLAUGHLIN: Does that view of John McCain surprise you, Pat?

MR. BUCHANAN: John, a family of two workers making $39,000 a
year, with two kids, gets a thousand-dollar tax cut. Man, that is big
to working Americans.

MR. ZUCKERMAN: No.

MR. PAGE: Two VCRs, yeah. (Laughs.)

MS. CLIFT: Yeah, and if you make a million-two, you get
$849,000, you know.

MR. MCLAUGHLIN: Exit question: By the time the Bush economic
plan has gone through the legislative meat grinder, with the
inevitable add-ons, subtractions, grinding and stuffing, will the
final product look like the Bush plan or be no longer recognizable as
the Bush plan, Pat?

MR. BUCHANAN: It will be as big or bigger than the Bush plan,
but of the Bush elements, about 85 percent he will get. And there
will be Democratic elements in it.

MR. MCLAUGHLIN: Eleanor?

MS. CLIFT: No, he won't get nearly 85 percent. But he'll claim
victory, whatever it is.

MR. MCLAUGHLIN: Clarence?

MR. PAGE: Yeah, I agree. There will be pressure from the
states, the governors, as well as the fact that we're robbing from
Peter to pay Paul. We're raising the national debt and deficit, and
it's going to, in the long run, be damaging.

MR. MCLAUGHLIN: Mort?

MR. ZUCKERMAN: I believe there will be more money front-loaded
to be spent in the first year or 18 months. I believe the dividend
tax credit will be reduced by at least a half, and that's basically
the outlines of the package. The Democrats will get what they want,
the Republicans will get as much as they can get, and that will be a
package that will be put together.

MR. MCLAUGHLIN: Will it be recognizably Bush?

MR. ZUCKERMAN: Absolutely. He was the one who took the
initiative and proposed this to a degree that was -- it was a very
bold plan. I give him a lot of credit for that.

MR. MCLAUGHLIN: Why?

MR. ZUCKERMAN: Why what?

MR. MCLAUGHLIN: Why give him so much credit for a plan that many
people think is reckless?

MR. ZUCKERMAN: Because here is a man who literally -- I think he
did it on the basis of his understanding of the policy. I think -- I
don't think he did -- I don't think this makes political sense for the
Republicans, frankly. I don't think it --

MS. CLIFT: This is supply side again. Lose it.

MR. ZUCKERMAN: I don't think it stimulates the economy enough in
2003 into 2004, when he's going to be reelected. Remember what
happened to his father.

MR. MCLAUGHLIN: Well, why is it so bold? Because --

MR. ZUCKERMAN: Because it's a huge program over 12 years, over a
long policy period.

MS. CLIFT: It's ridiculous.

MR. BUCHANAN: John, he believes it. George Bush believes.
That's why he did it. His reelection depends on it.

MR. MCLAUGHLIN: Boy --

MR. ZUCKERMAN: The scale of it is a very -- did anybody expect
that we were going to --

MR. MCLAUGHLIN: Okay. The answer to my question is, what comes
out of the meat grinder will be unrecognizably Bush.

MR. MCLAUGHLIN: We'll be right back with predictions.

(Announcements.)

MR. MCLAUGHLIN: Predictions, Pat?

MR. BUCHANAN: John, President Bush's father set the all-time
record for a deficit, 292 billion. The deficit this year by young
President Bush will exceed that by many, many billions of dollars.
But it will not matter if the plan works and the economy's booming
next year.

MR. MCLAUGHLIN: You mean more than 292 --

MR. BUCHANAN: At 350 billion, John.

MR. MCLAUGHLIN: Wow. What about the trade deficit?

MR. BUCHANAN: The trade deficit -- merchandise will hit $500
billion this February.

MR. MCLAUGHLIN: (Inaudible word.)

MS. CLIFT: Yeah. Bush is on his way to creating a trillion-
dollar deficit, and he'll be long since gone out of town when
everybody else has to dig out of that hole.

The White House will not enter the affirmative action -- the
Michigan affirmative action cases before the Supreme Court. Karl Rove
just gave the right wing Mr. Pickering, and he's not going to give
them affirmative action too.

MR. MCLAUGHLIN: For the same reason that -- to protect
themselves against getting hurt by more racist charges.

MS. CLIFT: Well, you got to cater to the right wing --

MR. MCLAUGHLIN: Right.

MS. CLIFT: -- but you also got to reach out to the suburban
soccer moms.

MR. MCLAUGHLIN: Quickly.

MR. PAGE: Well, since Eleanor took my prediction, I will predict
that the U.S. will take military action in Iraq before February's
over.

MR. MCLAUGHLIN: You will?

MR. PAGE: Yes. And if we don't, it's only because the president
wants to spite me. (Laughs.)

MR. MCLAUGHLIN: I'd like to know how you reached that
prediction.

MR. ZUCKERMAN: The Bush economic program will be passed within
90 days. There will be a deal with the Democrats that will give them
about twice as much money up -- frontloaded, and that will kick off
the economy in the second half of the year and next year.

MR. MCLAUGHLIN: I predict Cyprus, which has been divided for 30
years between the Turkish North and the Greek South, will be reunited
before February the 28th.

Bye-bye.

END OF REGULAR SEGMENT

PBS SEGMENT

MR. MCLAUGHLIN: Issue three: SUV reality check.

(BEGIN ADVERTISEMENT AUDIO)

VOICE OF A WOMAN: I helped hijack an airplane.

VOICE OF A WOMAN: I helped blow up a nightclub.

VOICE OF A MAN: So What if it gets 11 miles to the gallon?

VOICE OF A WOMAN: I gave money to a terrorist training camp in a
foreign country.

VOICE OF A MAN: It makes me feel safe.

VOICE OF A MAN: I helped our enemies develop weapons of mass
destruction.

VOICE OF A WOMAN: What if I need to go off road?

VOICE OF A MAN: Everyone has one.

VOICE OF A MAN: I helped teach kids around the world to hate
America.

VOICE OF A WOMAN: I like to sit up high.

VOICE OF A MAN: I sent our soldiers off to war.

VOICE OF A MAN: Everyone has one.

VOICE OF A WOMAN: My life; my SUV.

VOICE OF A MAN: I don't even know how many miles it gets to the
gallon.

(END ADVERTISEMENT AUDIO)

MR. MCLAUGHLIN: These ads are now airing across the country.

Question: How were you impressed with these ads, Pat, owner and
driver of a Lincoln Navigator? (Laughter.)

MR. BUCHANAN: John, I've talked to Arianna Huffington about
this. Mrs. Huffington herself used to have a Navigator. Look, she can
do what she wants, but the American people have voted for the SUVs
because they like them and they're very safe. And frankly, if the
price of oil goes up, they will get out of them and get into smaller
cars. And if you need more oil in the United States, start drilling
in Alaska.

MS. CLIFT: No, they're not safe --

MR. PAGE: They're safe for the people in the SUVs.

MS. CLIFT: Yeah. They're not safe for people like me.

MR. BUCHANAN: They're safe for me.

MR. PAGE: Right, safe for you, yeah.

(Cross-talk and laughter.)

MS. CLIFT: I drive a Geo Prism, and I feel like I could get
swallowed up in a Navigator. But look, these ads are a satirical
take-off of the drug ads, the anti-drug ads that the administration
ran. And they tried to make a connection there between drug use --
smoking marijuana and terrorism.

MR. MCLAUGHLIN: You don't think there's a connection? Gallons
of gasoline and --

MS. CLIFT: No, what I'm saying is --

MR. MCLAUGHLIN: -- and loads of cocaine?

MS. CLIFT: No. Arguably, the connection between overuse of oil
and terrorism is much greater than the drug connection. And maybe
some people will start thinking. A lot of these people who drive
these navigators have American flags, and maybe they don't get the
fact that we're dependent on foreign oil and it would help if they got
more miles to the gallon.

MR. PAGE: There is one point that is raised here, which is, for
most people who cynically say we care about Iraq for oil, yes, true,
we are oil-dependent in this country. And that is a key part of the
debate that really hasn't been talked about enough openly. And like Pogo said, years ago, in the comic strip, "We have met the enemy, and he is us."

MR. MCLAUGHLIN: What's the basis for this argument against the
SUV? After all, we are a nation of super-sizing. We have a terrible
obesity problem. Then we have an infatuation with SUVs, and even with
the Hummer -- they're coming on-stream. Did you notice that?

MR. ZUCKERMAN: Yes.

MR. MCLAUGHLIN: I think Pat ought to be behind the wheel of an
18-wheeler! (Laughter.)

MS. CLIFT: Right! (Laughs.)

MR. MCLAUGHLIN: Are we hyper-competitive? Are we in a zero-sum
game all the time? Are we hyper-aggressive?

MR. ZUCKERMAN: Look, the issue isn't the size of our cars, the
issue is the fact -- being dependent on a region of the world which is
where most of the reserves are, and it being the most unstable part of
the world, which has involved us in --

MR. PAGE: Partly because of the oil.

MR. ZUCKERMAN: Right. We wouldn't -- if they just made
cucumbers, I guarantee you we wouldn't be involved there, okay?

MR. PAGE: Thank you. And they'd be modernized by now.

MR. ZUCKERMAN: And what is happening is that the Saudis have
turned out to be the biggest financiers of the exportation of Wahabi
extremism all around the world of Islam, and that is coming back --
that's coming back and hitting us.

MR. BUCHANAN: Let's get back to the SUVs. The reason we got all
these big cars is because we are not a little dinky country like the
European countries -- (laughter) -- I mean, you can get across them in
10 minutes. We've got a huge country, giant roads, and you need big
cars and large SUVs!

(Cross talk.)

MR. BUCHANAN: America first! (Laughs.)

MR. MCLAUGHLIN: It's a species of patriotism!

Do you know that the big vehicles are used to protect children
because you've got a lot of hood out there and you've got a lot of
size. And in point of fact, they are safer.

MR. PAGE: For the people in that car.

MR. MCLAUGHLIN: Do you think it's fair to say that --

MR. ZUCKERMAN: The issue is not the size of the car, but whether
or not the fuel efficiency of those cars could be improved, and they
can be, and they have to be, and they should be doing -- we should be
doing more about that.

MR. MCLAUGHLIN: No, the issue is whether the promoters, sponsors
and believers in this advertising are really as pro-life as are the
drivers of SUVs, or are they anti-life, because those SUVs protect
life.

MS. CLIFT: No. There are still more people that are not in SUVs
--

MR. ZUCKERMAN: John, I wondered about -- I wondered how the
connections were made in this commercial, but I mean you put that --
you put them to shame as a model of coherent logic! (Laughter.)

MR. MCLAUGHLIN: (Laughs.) If you're prof-life, if you're
protecting your children and your older people in an SUV, and if they
want to take it away from us, they're anti-life.

MS. CLIFT: No.

MR. ZUCKERMAN: That's not the issue. The issue is not the size
of the car, but the fuel efficiency of the car.

MS. CLIFT: You have to think beyond your own immediate --

MR. BUCHANAN: It's the size of the nut behind the wheel!
(Laughs.)

####



END